It’s easy to understand why increasing a rep’s commission rate can be an effective motivator. But is there ever a good reason to decrease commission rates? That’s the question every business must answer when considering implementing a sales decelerator.

In this article, we’ll explain what a decelerator is, what scenarios they’re used in, and how to implement decelerators with the strategy and care they require.

What you’ll learn:

• What is a decelerator?
• Decelerators vs. accelerators
• Common sales decelerator use cases
• Best practices for using commission decelerators in your comp plans

What is a decelerator?

A sales decelerator, sometimes called a commission decelerator or de-accelerator, refers to a mechanism or policy that reduces the rate at which salespeople earn commission. 

Companies use such policies to help manage the performance of their sales teams. Unlike accelerators, which offer higher commission rates for reaching specific targets, decelerators work in the opposite way. They decrease a sales rep’s commission rate at certain performance thresholds.

Decelerators vs. accelerators

A sales accelerator rewards high-performing salespeople by increasing a rep’s commission rate as they exceed specific sales targets.

Decelerators do the opposite. Companies use deceleration policies to decrease commission rates when salespeople fail to meet specific targets or underperform. In other words, accelerators incentivize salespeople to continue high performance and decelerators act as a penalty for not meeting goals.

The decision to use decelerators or accelerators depends on the company’s sales goals and priorities. If the company wants to discourage certain outcomes, decelerators may be more appropriate. Conversely, if the goal is to encourage behaviors or reward high performance, accelerators can be beneficial. It’s important to consider desired behaviors and outcomes before deciding to use decelerators, accelerators, or a combination of both.

In some cases, companies may use a combination of decelerators and accelerators to strike a balance between encouraging desired activities and discouraging undesired ones. 

For example, a company may implement an accelerator to reward salespeople who meet or exceed revenue targets but also implement a decelerator to reduce commission rates for salespeople who excessively discount prices to close deals. This approach can help create a compensation plan that motivates salespeople to achieve results while also aligning with the company’s strategic objectives.

Common sales decelerator use cases

Sales teams use decelerators in a variety of ways. Let’s take a look at some of the more common scenarios in which a company may incorporate a decelerator into their comp plans.

Prioritizing (or deprioritizing) specific products or add-ons

For companies that offer a range of products or solutions, it often makes sense to use accelerators or decelerators to encourage sales across the entire product portfolio.

Here’s an example: Company X sells one primary SaaS platform that has multiple paid add-ons (i.e. integrations, services, and features). The commission plan at Company X rewards reps with an accelerator after reaching quota attainment – meaning they receive a larger commission percentage for any deals they close after hitting their quota.

This setup, however, has an unintended consequence: Reps now see add-ons as time-consuming pitches that have minimal impact on their wallets or their sales quotas. They just want to close enough deals to hit their quota, regardless of the specifics of those deals. As a result, they stop trying to sell add-ons and move on to new deals quickly in order to hit that accelerator faster.

To correct this behavior, Company X adds a decelerator to the team’s comp plan that requires reps to sell a certain number of add-ons each quarter. If a rep doesn’t hit this goal, their commission rate for deals during the next pay period decreases. This encourages reps to sell the full range of products and add-ons and discourages them from trying to rush through quick-win deals to hit their accelerator faster.

Decelerator Example #1 – Use Case: Incentivize deals with add-ons

10% commission on each deal (reps who sold one or more add-ons during the previous pay period)

7% commission on each deal (reps who didn’t sell any add-ons during the previous pay period)

Avoiding capping compensation plans

A commission cap can have a negative impact on morale and motivation – even if reps never reach the cap threshold. Though most companies understand the risks of commission caps, they’re sometimes a necessary evil due to budget constraints, market conditions, or other factors outside a company’s control.

Fortunately, you can use decelerators instead of commission caps in these scenarios. 

For example, Company Y uses the same commission rates across all teams and deal sizes. But they struggle to keep reps motivated after they hit their quota each quarter. So, they consider adding an accelerator that bumps up a rep’s commission rate after they reach quota attainment.

But, after crunching the numbers, the leadership team worries that this accelerator might work a little too well, causing them to spend more than they budgeted for sales compensation.

Although this could be reason enough to implement a commission cap, Company Y knows that capping earnings can have a negative impact on sales teams. Instead, they elect to implement the accelerator and also implement a decelerator. The end result looks something like this:

Decelerator Example #2 – Use Case: Avoid capping comp plans

10% commission up to quota attainment

15% commission from 100% to 150% of quota

12% commission after 150% of quota

Here’s the logic: The company wants to have controls in place to prevent overspending on sales commission, but doesn’t want to cap commission completely. They set an extremely high threshold for the decelerator, knowing that if they set quotas correctly, the decelerator will impact very few sales reps. If reps are often hitting the decelerator threshold, leadership will view that as a signal to reevaluate their quota-setting process.

Penalizing underperformance

Companies also use sales decelerators to penalize underperforming sales reps. Typically companies tie this type of decelerator to low quota attainment, just as an accelerator is usually tied to high quota attainment. 

For example, Company Z has a significant number of reps who aren’t meeting quota. Although they’ve implemented an accelerator to encourage overperformance, it did little to incentivize the reps that weren’t achieving quota attainment.

For this reason, Company Z also implemented a decelerator. Here’s how it works:

Decelerator Example #3 – Use Case: Penalize under-performance

10% commission on each closed deal up to 100% quota attainment

12% commission on each deal closed past 100% quota attainment

7% on each closed deal if the rep failed to exceed 60% of their quota

In this example, the decelerator almost acts like a tiered commission structure – but one that discourages underperformance rather than encourages overperformance.

Best practices for using commission decelerators in your comp plans

It’s important to use decelerators strategically to avoid confusion and discontent in your sales organization. Here are a few best practices to keep in mind.

Communicate decelerator rules clearly

It is essential to clearly define the criteria that will trigger a decelerator. This ensures transparency and helps to avoid any confusion or disputes. Sales reps should be aware of the specific conditions that may result in a deceleration of their commission earnings.

Align decelerators with sales performance goals

Decelerators should align with the overall performance goals of the company. They should discourage activities and performance that are not in line with the company’s objectives or values. Sales reps shouldn’t feel like decelerators exist just to hold them back or punish them; they’re used to keep the sales department and the organization’s priorities aligned. 

Provide regular feedback and coaching 

Regular feedback and coaching sessions are crucial when using decelerators. Sales managers should provide constructive feedback to help reps improve their performance and avoid triggering decelerators. This helps create a supportive environment and encourages continuous growth and development.

Balance out decelerators with positive incentives

Decelerators often highlight negatives and punish underperformance. In order to avoid creating a negative, high-pressure environment, it’s also important to reward high-performing reps and incentivize positive behavior. With the potential to reach accelerators and other positive earnings potential, reps will be less likely to let decelerators stress, demotivate, or discourage them.

Review and adjust decelerators periodically

It’s important to review and assess the effectiveness of decelerators regularly. This allows the organization to make adjustments and refinements based on the changing needs and dynamics of the sales team and the organization as a whole. By continuously evaluating the impact of decelerators, companies can ensure they are achieving their desired outcomes.

Use decelerators to as part of a balanced comp plan

It’s important to be cautious any time you implement a protocol that adversely impacts a sales rep’s earnings. But, when used strategically, a decelerator doesn’t have to be a cloud over your sales reps’ heads. As long as you establish clear rules and goals, communicate clearly, and make adjustments as needed, a sales decelerator can be a valuable tool in developing more effective and cost-efficient comp plans.